Trying to Revive a Sluggish Economy? Look to Women

Authorities around the world are struggling to spur weak economic growth. The International Monetary Fund has one solution it says could instantly juice up any economy: encourage more women to join the paid labor market.

For example, Booz & Co. estimates that raising female labor force participation rates to the same levels as males could boost U.S. gross domestic product by 5%, add 9% to Japan’s GDP and expand Egyptian GDP by a whopping 34%. David Cuberes and Marc Teigniercalculate losses attributed to gender gaps in the labor market could reach 27% of GDP per capita in some regions.

For fast-aging economies such as Japan, higher female participation can offset the shrinking workforce, the fund says. More job opportunities for women can contribute to broader economic development for developing nations, including by lifting education levels for girls.

So how can authorities encourage women to join the labor force? The fund says changing tax laws, giving girls better education and improving childcare are a start. But there are raft of social norms that will have to also change for women to fully join the paid labor force.

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